Organic milk sales booming in Britain
demand for organic milk, says a new report, offering new
opportunities for the industry.
Organic milk sales in the UK grew 91 per cent in the 12 months up to last November and had grown 30 per cent per year for the decade before that, says a market report by the Organic Milk Suppliers Co-operative (OMSC).
Sales have now topped £100m per year thanks to organic milk's healthy and environmentally friendly image.
The OMSC claims marketing campaigns to publicise research showing organic milk to be naturally higher in omega-3 fatty acids, vitamins and antioxidants, have "substantially increased" sales.
But, the growing popularity of organic milk in Britain has now left the country short of supplies, the report says.
The situation is a complete turnaround from the last five years, which has seen the industry face a serious over-supply of organic milk.
A number of dairy farmers switched to organic production in the late 1990s in an attempt to boost income, yet a few years later some reported organic milk just being thrown down the drain because of supply gluts.
UK dairy processors and producers could now take advantage of the reversal.
The OMSC report says five per cent of supermarket milk sales is organic, and it estimates that consumer demand would rise by another 45 per cent this year.
Liquid milk makes up around two thirds of Britain's organic dairy market, although yoghurt has begun to emerge strongly in recent years - led by the Yeo Valley and Rachel's Organics brands.
Yet, OMSC warns that, while more organic milk is needed to meet demand in the short term, the industry must maintain a balance to prevent another glut. It predicts the market will only absorb another 60m litres over the next two years, equivalent to 75-100 farm conversions per year.
There has been much debate on how profitable, if at all, organic dairy production is due to stricter regulations requiring higher input costs.
Retail prices for organic milk remain higher than for non-organic, however, and OMSC says more organic products are needed to meet rising demand. The liquid market still has significant potential, with organic milk currently only making up one pint sold in every 30.
The success of organic milk in the UK follows a boom in the country's organic food market generally.
OMSC's report says Britons spent a collective £1.25bn on organic food in 2005, a far cry from the £100m in sales made by the sector a decade ago. The UK was Europe's fourth largest organic food market in 2003, behind Italy, Germany and Spain, according to research group Organic Monitor